The age of eDiscovery

We have all read about them in the popular media, much less in the more rarefied business and technology press – those big banking and finance scandals with ancient emails and recorded phone calls dragged up to embarrass and trap the guilty parties. Some of these scandals have been close to home, in fact, with certain top Anglo execs apparently blithely unconscious of their own voice recording systems. Email is certainly dangerous if you are plotting a corporate coup (or one of the more political kind), dodging intelligence agencies, bullying that little b… in Accounts or just diddling the business. There is always a trail.

But then any kind of record or document can become relevant when past actions are being examined, from scribbled notes to contract drafts to memos and spreadsheets and, naturally, financial records. Where the whole eDiscovery thing moves from being tabloid entertainment to a concern and even threat to any organisation is when you realise the sheer volume of data that could be involved. The biggest known so far in Ireland was the Thema International Fund v HSBC case, a Bernie Madoff-related matter settled in 2013, where a total of 70 million records were involved in the eDiscovery process. According to one of the country’s leading experts in this field, Andy Harbison, director of litigation technology in Grant Thornton, a current case heading for the High Court involves perhaps twice that volume of records.

Anyone’s mind would boggle and any Board threatened with that level of eDiscovery would need counselling in every sense. Scale is always relative. The burden of millions of records might be heavy on an enterprise that holds billions of them. But just thousands of documents and other records could be an even greater burden for a medium-sized organisation, conceivably even unaffordable. There are already, Four Courts gossip suggests, several instances of outfits with deep pockets attempting to bully smaller litigants into submission or settlement with the threat of massive eDiscovery fees. When those fees alone can reach into the tens and hundreds of thousands of euro before a case even gets to court – and are always open-ended to a high degree – all potential commercial litigants will think again. And again and again.

 

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Part of the process
But aside from civil litigation, eDiscovery is now actually common in criminal cases, judicial reviews of decisions by government agencies and apparent breaches in fields such as financial services, accounting, pharmaceuticals and other regulated sectors. It could also be demanded by the Revenue Commissioners, for example, or the National Employment Rights Authority or other statutory agencies. In other words, compulsory eDiscovery is a real and present risk for any organisation today, from a multinational to an SME.

That means that all organisations need to be aware of the implications of eDiscovery, which in turn means knowing at least something of the technologies potentially involved. The eDiscovery side means disruption and time-consuming involvement by your own staff, inevitably senior. But the frightening element for any organisation is that after the electronic search element of eDiscovery has made its main pass all of the documents or records found have to be reviewed for relevance to the main matter or cause by a lawyer. “Our experience is that the typical costs are in the range of €1.50 to €3 per document and a legal reviewer will get through maybe 300 to perhaps 500 per day,” said Harbison. “Relatively junior solicitors or barristers are usually used, deciding on whether each document is relevant. But there are areas which need more experience or senior judgment, such as whether some legal privilege applies, and the fees will reflect that.”

His explanation of the difference between eDiscovery and IT forensics may be mildly reassuring to any director with budgetary responsibility: “I say it’s like archaeology versus road building. With eDiscovery the amount of data can be huge but the depth of excavation expected is practical. It’s really about what should be available in the normal way. Every effort is expected, the best tools must be used and best practices employed. But no court expects the results to be absolute or perfect. In any event, a case may well rest on a single ‘smoking gun’ incriminatory document.